Standard & Poor's downgrades Russia's credit rating to junk

(QHA) -

Russia's foreign-currency credit rating was cut to junk by Standard & Poor's, putting it below investment grade for the first time in a decade, as policy makers struggle to boost growth amid international sanctions and a drop in oil prices.

S&P, which last downgraded Russia in April, cut the sovereign one step to BB+, according to a statement released today, the same as countries including Bulgaria and Indonesia.

The ratings firm said the outlook is "negative". Russian stocks on US exchanges tumbled with the ruble following the announcement which came after the close of equity trading in Moscow.

The world's biggest energy exporter is on the brink of a recession after oil prices fell to the lowest since 2009 and the US and its allies imposed sanctions over President Vladimir Putin's actions in Ukraine.

The penalties have locked Russian corporate borrowers out of international debt markets and curbed investor appetite for the ruble, stocks and bonds.